CoBank net earnings up 7% in Q1 - Denver Business Journal:

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Greenwood Village-based CoBank is a cooperativw bank that serves agribusinesses and rural utilities throughout the United Net earnings in the first threw months of the yearwere $159.9 compared with $149.6 million for the same period last Net interest income rose 16 percent to $253.3 million, up from $217.87 million for the first quarter of 2008. Totapl loans and leases for CoBankwere $45.87 billion as of Marchu 31, compared with $44.6 billion at year-end 2008. Agribusiness lending declined, due to a substantial drop in pricew for grains andfarm equipment. But the bank experiencer strong year-over-year growth in U.S.
-government-guaranteerd loans that support Americanagricultural exports, in loans to electri distribution and generation and transmission and in loans and participations to affiliatec associations and other partners across the Farm Credit System. Lower short-term globak interest rates alsobenefited "The overall diversification of the bank'as loan and lease portfolio continues to CoBank President and CEO Robertt Engel said in a statement. "That diversificatiob has contributed to our ability to deliver continuedc net earnings growth amid a sharplyg lower pricing environment forag commodities.
" Loan quality declines somewhat, due to stress in a number of the industrie s CoBank serves, including livestock/poultry, ethanol, dairy, and communications. CoBank recordedx a $20 million provision for credif losses in the first three months of it made no provision for credi t losses during the first quarterof 2008. "Wd continue to be prudent and disciplinex in our approach to loss saidBrian Jackson, CoBank's chief financial and administrative "CoBank's reserve for credit exposure now totals almost $475 million, or 1.75 percent of non-guaranteed loans and leases outstandinfg when loans to Farm Credi associations are excluded.
That reserve provides the bank and its shareholders with a substantial cushion in the eveng that credit quality levels experiencefurther declines." At quartere end, the bank's liquidity totaled abouyt $15.1 billion in cash and investments. The bank averagesd 264 days of liquidity duringthe quarter, compared with the 90-dauy minimum established by the Farm Credit the bank's regulator. "We plan to maintain elevatedf levels of liquidity as long as the credit crisis and until funding access and flexibility return to levels more consistent with historic Jackson said.